Safety & people

H+H puts safety first and strives for Zero Harm to people, contractors, suppliers and customers

SDG 3 Gender equality

• Target 3.5 Strengthen the prevention and treatment of substance abuse, including narcotic drug abuse and harmful use of alcohol

• Target 3.9 By 2030, substantially reduce the number of deaths and illnesses from hazardous chemicals and air, water and soil pollution and contamination

• Target 8.8 Protect labour rights and promote safe and secure working environments for all workers, including migrant workers, in particular women migrants, and those in precarious employment

H+H’s commitments

• Reduce lost time incidents frequency (LTIF) to 3 by 2024

• Reduce absenteeism through sickness to 9 days per annum by 2024

• Improve gender diversity within the Board of Directors to minimum 25-40% of the under-represented gender by no later than at the annual general meeting in 2023 In 2020, employee health and safety has been in even greater focus due to the COVID-19 pandemic.

During this time, H+H has been able to ensure business continuity while improving its safety performance and ensuring the well-being of its employees in uncertain times.

H+H takes the management of safety risks inherent in the business very seriously and continuously works to create safe and healthy workplaces and conditions for its employees.

This approach is guided by H+H’s Health and Safety Policy. In moving towards its Zero Harm ambition, H+H is embedding a culture of safety and applying its safety management system across all of its operations. Near-miss reporting and root cause analysis are mandatory activities to continuously improve H+H’s performance together with external and internal audits. All incidents are escalated to Group management level for information and guidance purposes.

All H+H factories are eligible for an 18-month Safety Improvement Plan to drive the performance towards Zero Harm. H+H applies its safety management system across all acquisitions and is well-practiced in improving the safety culture and performance across locations that are new to the Group.

Local leaders are responsible for Health & Safety in their locations and are supported by safety officers and the Group Health & Safety leadership team. The leadership team is headed by the Group COO. Developing a robust safety culture is a continuous focus. In 2020, H+H carried out safety training across all of our factories.

COVID-19 response

Most of H+H’s factories remained in operation during the COVID-19 lockdowns in 2020 but under restrictions that complied with advice and requirements from national health authorities to avoid infection and to secure employees. The exceptions were factories in the UK which were fully closed for approximately three months. The health and safety of H+H’s employees remains a top priority and procedures have been introduced to protect employees from infection.

These include amongst other separation of shifts within factories and providing flexible work-fromhome arrangements for office-based employees. As a result, none of H+H’s workplaces – factories or offices – were shut down due to illness.

Safety

Safety performance

H+H had zero employee fatalities in 2020, marking the fifth consecutive year with no fatalities across the Group.

LTIF is on par with last year at 6. Over the last five years the LTIF has improved by an average of 20% per annum. The LTIF improvement target is a rolling 50% reduction of the accident rate over a five-year period (i.e., to be 3 in 2024). 19 of the 29 locations recorded zero incidents in 2020. To deliver further improvement in the safety performance H+H will in 2021 relaunch the safety improvement strategy with nine key strategic areas:

• Management showing Leadership in Safety.

• Risk Assess all operations to determine critical parameters.

• Install all pragmatic Engineering Protection.

• Implement Written Safe Operating Procedures (SOP’s) including the use of Personal Protective

Equipment (PPE).

• H&S Training for managers and supervisors.

• Supervision to ensure SOP’s are followed and

PPE used.

• Safety Improvement Plan (SIP) to systematically drive site safety.

• Near Miss Reports (NMR’s) to pick up opportunities for improvement.

• Group and External Audit to verify maturity and direct SIP content.

Other actions include:

• 9 Safe Rules for Life. Based on our accident history these 9 rules apply to all aspects of the company, not just factories and culminate in the Golden Rule: STOP all work if conditions are dangerous or behaviors are unsafe.

• After the successful NEBOSH training in 2020, further training of the supervisory level will be continued in 2021 to ensure the front-line managers have the tools they need to drive safety improvements.

• Further development of Toolbox talks in all locations.

• Revised Contractor management policy with improved Permit to work procedures designed to keep our specialist support safe in our factories.

• Increased participation of senior management in root cause analysis and review.

• Introduction of a Group award scheme for safety improvement at a regional and Group level.

People

H+H aims to be an attractive employer to attract, retain and develop its workforce

H+H seeks to become an employer of choice by providing a safe and attractive work environment while improving diversity and inclusion. This is not only to remain competitive as an employer but to ensure that H+H continues to attract talent as Europe’s ageing and shrinking workforce is expected to create challenges in recruiting for manufacturing positions. Fewer young people are joining industries with factory-based production. In particular, H+H faces a tight labour market for factory roles in Poland.

Therefore, continuous development of people in regard to competencies and personal development is key to helping them realise their potential and ambitions to the benefit of both the employees and H+H.

Diversity

The building materials industry is not known for being diverse and H+H is addressing this by having a H+H diversity policy for the Group encouraging diversity at all levels of the organization, without compromising on competence, qualifications and quality. H+H recognises that diversity is a key competitive advantage and important to achieving success in a global environment.

H+H seeks to be an attractive workplace for people with varied backgrounds, skills and cultures. The company is committed to providing equal opportunities in employment and always hiring the most qualified candidate for each of its recruitments, whether internal or external. H+H aims to recruit from a diverse mix of cultures, ages, backgrounds, skills, expertise and experiences to create a dynamic organisation that continues to advance the H+H Group in line with its strategic objectives.

Every H+H manager is responsible for fostering an inclusive and open working climate where diversity can be embraced in accordance with the values expressed in the H+H Diversity Policy and the Code of Conduct. H+H has a zero-tolerance approach to harassment. All H+H employees are encouraged to report any behaviour which is not in accordance with the Diversity Policy to their line-manager, local management or Group Legal. Reports can also be filed through H+H’s online whistle-blower system.

People Performance

During 2020 the gender pay ratio for the Group increased due a reduction of shift workers in Poland, where increase in competitors capacity lead to H+H reducing shifts to balance production output. The shift workers in Poland are predominantly men.

The gender split across the Group has been relatively stable over the past few years with an 15% ratio of women to men. However, the proportion of women is higher at executive and middle management levels and smaller among the production employees.

Absence through sickness stayed at same level as last year. During the year a number of activites to reduce this number has been taken, and the target of 9 by 2024 remains.

Fatalities

Lost Time Incidents Frequency for employees

Total recordable incident rate

Near miss frequency rate

2020 2019 2018 2017 2016

0 0 0 0 0

6

38 6

43 9

50 11

90

2,711 2,265 1,364 543 16

120 Full time workforce 31 December

Gender diversity

Gender diversity, Group Management

Gender pay ratio

Employee turnover ratio

Sickness absence

Unit 2020 2019 2018 2017 2016

FTE 1,538 1,625 1,616 1,022 986

% 15% 15% 14% 14% 14%

% 20% 20% 0% 0% 0%

Times 1.26 1.15 1.03

% 14% 12% 13% 13% 13%

Days per FTE 13 13 11 10

Board Diversity

The Board of Directors has set a gender diversity target to be achieve no later than at the annual general meeting in 2023 whereby each gender shall be represented:

• By at least one shareholder-elected board member, when the Board of Directors consists of a total of four shareholder-elected board members;

• By at least two shareholder-elected board members, when the Board of Directors consists of a total of five to seven shareholder-elected board members; and

• By at least three shareholder-elected board members, when the Board of Directors consists of a total of eight shareholder-elected board members.

If a male and female candidate for a position are equally qualified, the candidate representing the under-represented gender will be chosen.

The gender diversity target for the Board of Directors was not achieved in 2020 as the number of female board members remained at one out of six members, since there were no changes to the board composition during 2020.

Gender diversity, Board

CEO pay ratio

2020 2019 2018 2017 2016

17% 17% 17% 17% 20%

35 39 39